June 4, 2024
Major Bitcoin and Ether Options Expiry Set to Influence Market Sentiment
Altcoins News

Major Bitcoin and Ether Options Expiry Set to Influence Market Sentiment

Around $2.7 billion in Bitcoin and Ether options will expire on May 24, shedding light on current cryptocurrency market sentiment.

Bitcoin Options Expiry

A post by Greeks. live on X reports that 21,000 Bitcoin (BTC) options are set to expire, with a put/call ratio of 0.88. This ratio suggests a near-even balance between buyers and sellers, with a slight preference towards call options. The maximum pain point, the price at which most option buyers would incur losses, is set at $67,000, representing a nominal value of $1.4 billion.

Larger Expiry Event Looms

While the upcoming 21,000 contract expiry is significant, it is overshadowed by a much larger event on May 31, when a staggering $4.3 billion worth of options are set to expire, as noted by Deribit. Data from Deribit reveals that long positions dominate open interest (OI), with a significant $830 million linked to the $70,000 strike price. Additionally, higher strike prices, such as the $100,000 mark with $843 million in OI, indicate a bullish sentiment among traders. The $60,000 strike price, with $388 million in OI, stands out as the most notable for put contracts.

Ether Options Expiry

The options expiry event also involves a significant 350,000 Ether (ETH) contracts expiring, representing a notional value of $1.3 billion. The put/call ratio of 0.58 and a max pain point of $3,200 suggest a slightly bullish outlook, with more call options expiring than put options.

According to the Greeks. live report, Ethereum has recently led a crypto rally, inspired by progress in ETF developments, with a one-day 20% rise. Short-term options implied volatility (IV) for Ethereum reached 150%, significantly higher than Bitcoin’s current IV for the same period.

Market Sentiment and Future Implications

The divergence between Bitcoin and Ethereum is becoming clear. While Ethereum’s bullish sentiment remains robust, sustaining high implied volatility (IV) across major terms is challenging for the market structure. This indicates that calendar spreads might be a better strategy. Conversely, Bitcoin shows a more balanced mix of long and short positions, with a stronger emphasis on selling call options.

Conclusion 

The $2.7 billion Bitcoin and Ether options expiry on May 24, followed by a $4.3 billion expiry on May 31, will significantly impact market sentiment. Current data suggests a bullish outlook with substantial open interest and high implied volatility. These expiries will provide critical insights into future market directions, highlighting the importance of tracking options trends in the cryptocurrency market.

Image by master1305 on Freepik

Disclosure Statement: Miami Crypto does not take any external funding, or support to bring crypto news to the readers. We do not have any conflicts of interest while writing news stories on Miami Crypto.

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